Why don't airlines do more with customer data?

I work in an industry where we'd love to be able to collect lots of data about our customers so that we could analyze it to no end and identify opportunities for driving revenue at the individual level. In brainstorming ideas for gathering this data, I started to think about airlines as an example. This line of thinking brought me to many questions, but one stopped me cold. Why don't airlines do more with my data?

At a minimum, the airlines know where I commonly travel, what days of the week I typically fly, which seats I like, how far in advance I check-in, whether I usually check a bag, whether I travel alone or with others and how far in advance I usually buy my tickets. This is the minimum they know as I imagine that, given partnerships with credit card companies and other travel partners, the airlines could access lots more data about me through my frequent flyer number including spend levels by category or store, hotel preferences, etc.. Even with all of this data available, I don't ever get the perception that I'm getting particularly targeted offers or especially personalized service from the airline. Why not?

Airlines have started doing more targeted marketing based on your behavior. The most obvious was an effort by JetBlue to follow up on abandoned searches. Basically, if you were logged in and searched JFK-LAS but didn't buy anything then they send you an email a week later, advertising something about LAS. From the report on their efforts:

200% higher conversion rates (conversion defined as a sale made from the email)

The emails also generate a 1,640% increase in revenue per email delivered as compared to standard promotional emails.

Click to expand...

That was in July 2011. And I know that United has had similar emails in recent months; their most recent "you haven't traveled to XYZ in a while" campaign was a spectacular failure based likely on a bad set of data feeding the system. United has also piloted more "cute" things in their monthly account summary emails. Mine from a couple months ago had this in it:
As you can see, the bottom two bullet points were highly targeted.

Beyond that, there are all sorts of risks associated with marketing to you based on who you are, or who they think you are. There was an interesting article recently about how a guy at Target analyzed the purchase habits of their customers and was able to predict if they were pregnant or not. Turns out there was a bit of backlash when the marketing wasn't handled well. How would you feel if the company knew that you typically buy M fares for work so when you go searching for your vacation trip they only show you higher fares, assuming you're desensitized to the higher prices? Because that's the type of thing they can do with this data.

I do get emails suggesting that I book a hotel or car at my destination after I buy a ticket. Ditto for travel insurance, depending on the airline or OTA involved. I consider them junk mail, even if they are theoretically well targeted.

Would I prefer if they stopped asking me if there are any kids under 13 on the itinerary when I'm the only passenger travelling? Absolutely. And would I prefer to stop seeing the ads for Chase cards since I have one? Yup. But I can also see that there are bigger fish to fry.

Mine from a couple months ago had this in it:
As you can see, the bottom two bullet points were highly targeted.

...

Would I prefer if they stopped asking me if there are any kids under 13 on the itinerary when I'm the only passenger travelling? Absolutely. And would I prefer to stop seeing the ads for Chase cards since I have one? Yup. But I can also see that there are bigger fish to fry.

Airlines have started doing more targeted marketing based on your behavior. The most obvious was an effort by JetBlue to follow up on abandoned searches. Basically, if you were logged in and searched JFK-LAS but didn't buy anything then they send you an email a week later, advertising something about LAS.

I definitely see the point about online searches and following up on abandoned airfare search pages. I'm thinking more along the lines of personalized service at the airport or during/after the booking process. For example, the airline can probably figure out how long before my flight I get to the airport. They also know my home address and could use a secondary data source for traffic information. Put this together and they could recommend what time I should leave my house for the airport and offer to sell me ground transport through a partner.

As a second example, if they know that I belong the airline club or have status or a fare class entitling me entry to the club, why not provide me with a map of the terminal that includes directions from check-in to the club and from the club to the gate when I check-in online or at the kiosk?

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